1. Field of the Invention
This invention is directed to systems and methods for providing and servicing loans to purchasers in conjunction with goods or services. The systems and methods disclosed are also directed to customer retention.
2. Description of the Related Art
Sellers of goods and services often discount charges from a list price. For example, generally, the purchase price of goods or services can be reduced if those goods or services are purchased in relatively large amounts. This is of course due to the economics related to the transaction, specifically, the amount of profit that can be achieved by a seller of those goods or services for the amount being purchased. A seller may be willing to offer a discount for goods or services purchased in large quantities in order to secure the sale to the purchaser and perhaps the purchaser's future patronage. The discount may reduce the per unit profit on those goods or services for the seller. However, the transaction may be economically attractive to the seller due to a number of factors. Normal per unit prices charged for goods or services (sometimes referred to as “list price”) may be set according to assumptions regarding the transaction costs that assume purchases will be made in small amounts. Transaction costs may be reduced significantly when a large amount of goods or services are purchased. If a large quantity is purchased, then those assumptions may no longer apply, and profit margins might not be reduced significantly when volume discounts are offered, or those margins might not be reduced at all. Furthermore, a seller may have surplus goods or capacity for providing services that would be advantageous to the seller to transfer to purchasers of larger amounts.
Having a sure sale of a quantity of goods or services to a purchaser at a discounted rate may be attractive to a seller as opposed to uncertain sales at a higher rate. A seller can also use discounted goods or services as a marketing tool to make the seller's products more attractive as compared to a competitor to convince a purchaser to shift business away from the goods or services of competitors. Sellers can also use discounts to retain and reward existing customers.
A purchaser who plans to obtain a significant amount of goods or services therefore has a potentially attractive bargaining position when seeking a source or sources for the goods or services. The purchaser can approach the seller and negotiate a discount due to the large amount of good or services planned to be purchased. Likewise, if a seller approaches the purchaser, the purchaser can attempt to lower the seller's asking price based on the needed quantity of goods or services. The seller can also approach a purchaser marketing their goods or services at a discount. The seller can use incentives as a competitive advantage to secure the purchaser's patronage. The seller and purchaser generally negotiate to a price or rate that is agreeable to both parties, and which commonly redistributes additional profit due to the large purchase across both parties in some percentages.
A counterpart to this concept of reduced prices for quantity purchases is the concept of providing incentives to purchasers for progressive purchases made over time. For example, a seller might offer to sell items to a purchaser at a list price for the first ten items purchased, but offer a reduced price on the next ten and an even deeper discount for the following ten.
Another potential way to structure volume discounts is to make a projection of the quantity of goods or services that will be required by the purchaser over a given period of time. The amounts may not be known precisely due to the unknown demands of the purchaser's customer base or other unforeseeable factors. Using historical information, market data, purchaser plans, etc., however, the amount of goods or services required by the purchaser can be projected. Using this projection, the purchaser and the seller can then negotiate to reach agreement on pricing for the goods or services based on the projected need. Any agreement on pricing could then also include provisions for the eventuality that the actual amount of goods or services purchased over the period of time exceeds or falls short of the projected amount of goods or services.
Other motivations and arrangements for providing price incentives or discounts for goods or services exist. Each of these arrangements allows a purchaser to receive a discount from normal or list pricing, based, for example, on the volume of goods or services purchased, or planned to be purchased. In those cases where a purchaser makes a bulk purchase and the goods or services are purchased immediately, the amount saved by the purchaser in the bulk transaction is immediately available to the purchaser at that time. If the purchaser is a business, which volume purchasers commonly are, then the savings from the discount are available for other expenditures. This is particularly advantageous for small businesses where operating capital is at a premium.
Unfortunately for purchasers whose purchases are spread over a period of time due to the nature of the goods or services purchased or their planned use, etc., the savings due to a volume discount are not available to those purchasers until the purchases are actually made. It would be advantageous for such businesses to be able to obtain the value of a volume discount or incentives to be earned over a period of time in a lump sum. Where those purchasers are businesses, having the savings upfront would provide those businesses with operating capital that could be used in the business during the purchasing period. Indeed, the capital could be instrumental in enabling those businesses to purchase the amount of goods or services upon which the discount is based.
Furthermore, it is in the best interest of the purchaser and the seller for the purchaser to meet its planned purchase levels. It is also in the best interests of the seller to retain the patronage of the purchaser so that the purchaser continues to buy goods or services from the seller through the specified period of time over which purchases have been projected and beyond.
In the past, some companies have implemented programs where advances on marketing funds built into the cost of their products are provided to purchasers to be used for buying related equipment. A beverage supplier, for example, may price their beverages or syrup and supplies such that a portion of the purchase price is collected by the beverage supplier but later returned to the purchaser expressly for marketing the beverage supplier's products. In some arrangements, the beverage supplier has agreed to provide the purchaser with an advance on these marketing funds to purchase equipment for dispensing or vending the beverage supplier's products. For example, the beverage supplier may provide a purchaser with a three-year advance on the marketing funds to be spent towards the purchase of a soft drink vending machine. The purchaser would then need to purchase supplies from the beverage supplier order to cover the amount advanced. Until the advance is paid back, the purchaser would not receive the marketing funds from the beverage supplier as they are applied to cover the advance. Under these programs the purchaser simply continues to buy products from the beverage supplier, for example, until the advance is paid back. These programs have the disadvantage that the purchaser may not know the length of time that it must purchase beverages from the beverage supplier in order to pay back the advance. Furthermore such programs are inflexible as to what the advanced money is used for. That is, the purchaser is restricted and cannot spend the advance freely as it could spend its own operating capital.
What is needed then is a system and method for offering a purchaser new sources of operating capital while at the same time providing a way for a seller to provide incentives beneficial to purchasers without substantially reducing the seller's profit margin. Ideally, such a system and method would encourage a purchaser to obtain needed goods or services from the seller, and also foster goodwill between the purchaser and seller.